As Italy battles its debt contagion fears and struggles with its ailing financial system, a report out this morning revealed that Italians also appear to be holding on to more of their earnings than assumed. The monthly retail sales report out of Italy has less impact on the strength of the regional currency, the euro (EUR), but if the Italian economy continues to flop, larger ripples may become a cause for concern.
The report was expecting approximately 0.2% growth in retail sales in Italy, up from last month’s contraction of 0.2%. The actual report, however, showed an eerily similar reading of -0.2%. With spending in decline, a stimulus may become necessary to get the Italian economy going once again.
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